Past Event

Oil & gas issues in Routt County

Steamboat Springs  In spite of what appear to be good intentions, Shell Oil officials could find themselves hashing out water well monitoring requirements with the Routt County Board of Commissioners on Tuesday afternoon when they bring the Camilletti oil well permit back through the county approval process.

Ironically, the county already granted Quicksilver Resources a permit in July 2012 to drill the well just north of unincorporated Milner about 11 miles west of Steamboat Springs. However, Quicksilver officials were so displeased with water quality monitoring conditions placed on that permit they declined to ever sign or act on it. Both sides left the table expressing their frustrations.

This month, Shell has proposed to go beyond the newest water well monitoring requirements imposed by the state of Colorado for new oil wells at Camilletti and, unlike Quicksilver, does not plan to frack the well. As of a Monday briefing with planning staff, a couple of ambiguous sentences about how many water wells to test this time around seemed to be the only hangup between Shell and a vote of approval.

County Commissioner Doug Monger said Monday that he doesn’t see why some small differences about language should delay approval of the Camilletti well this time.

“I don’t see any reason to table this,” Monger said.

Since July 2012, Quicksilver and Shell have entered into an agreement that calls for profit sharing on new wells in an area of mutual interest where both companies own mineral rights leases, but Shell will conduct drilling operations. Also in the interim, the Colorado Oil and Gas Conservation Commission has enacted a new regulation, Rule 609, which spells out significantly less stringent water monitoring requirements on energy exploration companies than what Routt County was imposing on Quicksilver.

It’s a new oil company and a new Routt County Board of Commissioners in September 2013, but water and oil appear to remain a sticky subject.

County Planner Chris Brookshire told the commissioners that Shell is coming back for a new permit because it has chosen to make adjustments to the private road access to the well off U.S. Highway 40, shifting the point where the road crosses Cheney and Little Cheney creeks as well as expanding and shifting the location of the well pad to the west. This change in plans led the oil company to come back to the county for a new special use permit.

The Routt County Planning Commission voted, 7-0, on Sept. 5 to recommend approval of the permit. Shell representative Steve Compton, a water expert, told the Planning Commission that under Rule 609, Shell only is required to survey fresh water sources within a half-mile radius of the well bore, but because there is only a single spring within that distance of the Camilletti well, the company had decided to expand the boundary of its own volition to 1 mile for wells north of U.S. Highway 40. That brought eight mapped wells into play, of which three turned out to be nonexistent, Brookshire told the commissioners Monday.

The company has permission to test the remaining five wells but has yet to confirm that it can access all five. And that in turn has produced some vague language about how many wells the company will conduct baseline testing on to determine if chemical compounds like methane, benzene, toluene and others already are present.

Commissioner Tim Corrigan said he would prefer language in the conditions of approval that is not vague about how many wells Shell will test.

Brookshire pointed out that there is an ample number of additional wells in Milner, south of U.S. Highway 40 and within a 1-mile radius of the well bore that Shell could seek to test. But the company is not willing to go south of the highway.

To add to the irony, Quicksilver already had done some baseline testing of domestic wells in Milner looking forward to drilling the Camilletti oil well itself.

Now, the well is one of the last Shell plans to drill here before its announced departure from the Sand Wash Basin, comprising Routt and Moffat counties, to concentrate its efforts in more promising oil fields.

Comments

There was actually one dissenting vote during the September 5th Planning Commission Meeting. I still don't feel that it is a good decision to place this well directly above the Town of Milner. As professionally as the well sites are planned and constructed, they are not designed to handle a hundred year (or thousand year) event like what just happened with the floods in the front range. There are numerous well sites in Weld County that are compromised, and it will be the tax payers who will foot the bill for clean-up (after paying record high fuel prices that generated record profits for the companies).

"Quicksilver officials were so displeased with water quality monitoring conditions placed on that permit they declined to ever sign or act on it."

Really? So if you that displeased leave the county. I'm sure you can get easy approval down in Rifle and you will be pulling from the same pool of oil since the Niabrara runs for several hundred miles.

Walt...I actually agree with Quicksilver on their stance regarding the water monitoring conditions originally placed on this well by the former BOCC. I do believe though, that those conditions did help shape the current state water quality testing regulations being implemented (Routt county has always taken a "high ground" position on water testing) at the state level. I was also impressed with Shell Oil's commitment to going above and beyond what the current regulations stipulate. They did this of their own accord, and it shows a commitment to at least listening to the concerns being raised.

As far as Shell's decision to shift focus from Routt and Moffat counties (as far as I can interpret from the spokeswoman's response to my question at the September 5th meeting), the decision is based not on the presence of oil, but the cost to get it out of the ground. When oil prices jump from $4.00 to $6.00 per gallon, the play will likely become viable in their business model (seems like a good business decision).

So it will be taxpayers who "foot the bill" for Weld county cleanup but it won't be taxpayers or gasoline customers (which means everybody) that will "foot the bill" for thousand-year design standards or $6.00/gal gas???

Mark...hydraulic fracturing to stimulate wells only became viable when gasoline prices jumped. Companies didn't decide to use their own money for exploration and development.

Thousand year design standards might be excessive, but the Greeks, Romans, and Egyptians built structures and public infrastructure that lasted far longer. It is important to remember that almost everything that is manufactured or constructed today is meant to be disposable, and not last more than ten years. The high cost of construction and manufacturing is related not to actual cost, but because before anything gets done, a product or service is marked up ten times by people who do absolutely nothing. We are a nation of consumers, and all we care about is convenience.

They used slave labor, beat them till they dropped dead, threw them in mass graves and put the sledge hammer or shovel in another slaves hands.

It is also important to remember that much of the cost is in attorneys, red tape and regulations (read government) which do very little other than ensure a steady stream of litigants for the lawyers and courts, and a steady stream of citizens reduced to damn near slaves asking permission for almost every meaningful thing we do.